EPFO procedural hassles may deter employees from claiming higher pension

The list of documents, which the Employees Provident Fund Organization (EPFO) has requested pensioners to submit for higher pension, may deter employees from claiming a higher pension, according to an expert.  

“The claimants shall have to upload the option exercised by them under paragraph 26.6 of the EPF scheme.  Most pensioners may not have a copy of the said option.  Unless the option is uploaded the system will not permit the uploading of the subsequent details.  Uploading of option under 26.6 is the main hurdle. Further, if the employee who is in service has withdrawn the provident fund by way of a loan (for the construction of a house or for medical expenses etc.), he will have difficulty in remitting the additional contribution to be made to the provident fund,” said B.C. Prabhakar Advocate and President Karnataka Employers’ Association.

Section 26(6) of the EPF Act allows one to enroll as a member of the EPF scheme by filing a joint declaration of employee and employer, subject to approval by the Assistant Commissioner of PF.

The Employees Provident Fund Organization in their internal circular dated 29.12.2022 has requested the pensioners to submit the following documents along with the claim for higher pension.

1. Proof of joint option under Para 26(6) of the EPF scheme duly verified by the employer and

2. Proof of joint option under the provision to erstwhile para 11(3) duly verified by the employer and

3. Proof of remittance in Provident Fund on higher wages exceeding the prevalent wage ceiling of Rs.5,000/6,500/- and

4. Proof of remittance in the Pension Fund on higher wages exceeding the prevalent wage ceiling of Rs 5,000/Rs 6,500/- if any and

5. Written refusal of APFC or any other higher authority of EPFO to such requests /remittance.

“The documents (asked) will not be available with the employees. In the case of employees who are in service and continue to be the members of the Provident Fund Scheme may be able to collect it from their employers and submit it. In the case of employers who have retired but are eligible to claim the higher pension as per the judgment of the Supreme Court will have multiple difficulties in collecting the above documents and information.  The employees who have worked with different employers will have more difficulties than those employees who have continued in the same establishment throughout their service,” said Prabhakar. 

He added, “These difficulties may deter the employees from claiming for higher pension, particularly those employees who have already withdrawn the provident fund accumulation and shall have to redeposit the amount by the EPFO for claiming a higher pension.”

Also WATCH | Gold ETFs vs Gold Mutual Funds: What is best for you?

Also read: Ask Money Today: I have a surplus of Rs 15 lakh. Should I invest in a mutual fund or prepay a home loan?

Also WATCH | Sovereign Gold Bond scheme opens for subscription. Check details here

Also read: SBI Fixed Deposit schemes: SBI introduces 400-day tenure scheme, hikes rates on FD schemes below Rs 2 cr

Also WATCH China vs India: A comparison of defence budgets of two Asian giants